District 622 loses finance director

Even Greg Hein has to admit it’s a tough time for District 622’s finance director to be leaving.

But Hein, whose last day at the district is Jan. 4, says at least the district is on the best financial footing it can be.

Hein, who has been with 622 for 2 1/2 years, is leaving for the Faribault district. “I’ve been looking for a change and thinking for some time about moving to a smaller district,” he says. “Something a little more manageable, living in a smaller town.” Faribault has an enrollment of about 4,000 students, he says, compared to 622’s more than 11,000.

Meanwhile, 622 faces budget cuts of $4.5 million to $5 million from its 2006-07 budget. “I feel pretty good about the shape I’m leaving the district in as far as the budgeting being sound,” Hein says. “It’s a tough financial situation, but at least the budget and the audit is pretty sound.”

The causes of the shortfall are many of the same long-term trends that sparked cuts of $4 million during the 2004-05 year, Hein says: declining enrollment, growing costs of retirement plans and special education services, spiraling energy costs and upcoming contract settlements.

One of the first things Hein did when he arrived in 622 from the Duluth district was to rework 622’s transportation plan, incorporating private-school students on 622 bus routes and setting up a “hub-and-spoke” system that saved staff, equipment and fuel costs.

Hein also reviewed the district’s relationship with the Northeast Metro 916 intermediate district and other agencies that provided special education services. He and other administrators determined that the district could save money and keep students closer to home by offering some programs on its own, a move he says has saved the district several hundred thousand dollars.

However, the costs associated with special education are going up, even as enrollment declines, he says. “Even though our overall enrollment is going down, our special education population is not going down, and it seems the severity of the disabilities is on the increase,” he says. By law, the district has to provide services to special-education students until they are 21 years old, and it often keeps those students throughout the whole year. “A lot of the programs extend over the course of the summer as well, since they wouldn’t be able to retain a lot of the material with a summer break,” he explains.

Hein also tackled energy savings at school buildings during his tenure. The energy-saving program put in place last year has already saved about $160,000 just in the first 9 months of evaluation, he says. However, because the district had to pay natural gas prices this year that were 80 percent higher than last year’s, he says, “this year, we’re using less and paying more.”

The Legislature might discuss help for districts across the state who are in similar binds, he says, “but the legislature is in a non-funding cycle this year.”

Currently, the district is at its maximum levy and could not raise more funding without a public vote.

Asked if there are any “silver-bullet” cuts the district expects to make, Hein says discussions are still in the preliminary stages; the district is currently asking for ideas from staff and community members.

But such large cuts probably can’t be made without layoffs. “Eighty percent of our general fund budget is in staff, so obviously we have to look at staffing levels,” he says.

The superintendent and board are currently looking at hiring an interim business manager to get the district through the end of its fiscal year in June.

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